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Join co-founder, Jeff Olin, this Saturday on MoneyTalks – 8:30 Pacific , 9:30 Mountain to find out where he thinks the money’s to be made now.

Flight to Cash and Utilities Following Fed Announcement

If the Fed cuts interest rates, it means more money would flow into the economy and find its way to banks, individuals, and corporations (in that order), or so goes the traditional macroeconomic thinking. So why did investors not instantly embrace the news of the Fed cut by immediately plowing into growth assets, and instead flee all asset classes in favor of cash during the first hour after the announcement today?

Perhaps because not everyone in the professional financial community was prepared to take in the 0.25% rate cut the Fed announced – at least not immediately after the news. How these professional investors eventually responded may speak volumes about their upcoming investment strategy.

The major U.S. stock indexes ended the day essentially unchanged, but only after selling off significantly in the first hour after the Fed explained its reason for the cut. Curiously, it wasn’t just stocks, but all asset classes sold off during that hour, with the exception of the U.S. dollar (see chart below). U.S. dollar futures rallied notably during the hour, suggesting that in the immediate wake of the announcement Wall Street pros had to regroup and take the measure of the environment they were now in….CLICK for complete article

Join co-founder, Jeff Olin, this Saturday on MoneyTalks – 8:30 Pacific , 9:30 Mountain to find out where he thinks the money’s to be made now.

Canadian Mortgages Are Now So Large, The Benefit Of Low Rates Is Minimal

Canadian households are sending a lot more cash to lenders, but it’s not paying their debt down. Statistics Canada (StatCan) data shows household mortgage payments jumped in Q2 2019. Rising payments are seeing fewer dollars pay off debt, and more towards carrying it.

Canadians Paid Over $93 Billion On Mortgages

Canadian real estate owners paid a new record amount for mortgage debt. Over $93.15 billion in payments were made towards mortgage debt in Q2 2019, up 1.85% from the previous quarter. Compared to the same month last year, this number is 7.70% higher. The dollar amount dedicated has never been higher, but that’s not all that surprising. The surprising part is fewer dollars are going towards paying down the actual debt….CLICK for complete article

Gold Is Beating Buffett’s Berkshire Hathaway

Way back in January, I showed you that the price of gold had beaten the S&P 500 Index over a number of different time periods, including the month, quarter, year… and even the century (so far!).

Last week it was brought to my attention recently—in a tweet by Charlie Bilello, director of research at Pension Partners—that the yellow metal has also outperformed arguably the greatest living investor, Warren Buffett.

For the 20-year period, gold has returned more than 485 percent, beating Warren’s Berkshire Hathaway, which was up 426 percent.

Granted, gold saw an unusually strong rally in the 2000s, while equities were knocked down hard during the dotcom bubble and financial crisis. But that’s precisely my point. Those who had the prudence to diversify their portfolios during this period—and not just in gold but also bonds, real estate and more—were in much better shape than some other investors….CLICK for complete article

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